On December 28, Ecology and Environment Bureau of Xianyang City, Shaanxi Province issued a notice upgrading the orange alert for heavy air pollution to a red alert and activated a Level-I emergency response at 00:00 on December 29.
The electricity and coal enterprises involved in the bulk transportation of materials should prioritize rail transport for material logistics and implement transportation restrictions. This is expected to lower supply of local coking coal in the major coal producing province in China. While today steel and iron ore futures posted declines, coking coal futures for May contracts at Dalian Commodity Exchange increased by 1 percent. For now, market sources do not expect disruptions in supply in the long term and the restrictions are expected to be lifted after end of the New Year holidays.
